Half Year Report 2013: Passenger growth and steady profitable result

Revenue increased 5% to DKK 129.5 million in Q2 2013 from DKK 122.8 million in the corresponding period in 2012. The increase is mainly attributable to an increase in passenger numbers on scheduled services and increased charter activity as well as increased duty-free sales.

EBITDA (Earnings Before Interest, Tax, Depreciation and Amortisation) in Q2 2013 decreased 1% from DKK 24.7 million in the second quarter of 2012, to DKK 24.3 million.

The result before tax (EBT) for the second quarter of 2013 was DKK 7.6 million, compared with DKK 6.9 million in the same period last year and the result after tax for the second quarter of 2013 was DKK 6.2 million, compared with DKK 5.7 million in the second quarter of 2012.

The main explanatory factors for the higher result in Q2 2013 are the increased number of passengers and higher load factor on scheduled services. However, the result in Q2 2013 was also affected by decreased helicopter activity.

EBITDA in the first half of 2013 were DKK 37.7 million, compared with DKK 31.7 million in the first half of 2012, an increase of 19%. The result before tax for the first half of 2013 amounted to DKK 4.3 million, compared with DKK 1.7 million in the same period in 2012 and the result after tax amounted to DKK 3.5 million, compared with DKK 1.4 million in the same period in 2012.

The supply of seats (ASK) on scheduled services in the second quarter was 1% lower than in the corresponding period last year due to adjustments in capacity. Passenger traffic (RPK) on scheduled services increased 8% in the same period resulting in an increase in passenger load factor (PLF) from 71 to 78%. During the first half the supply of seats grew by 7% owing to the introduction of Airbus capacity in Q 1 and passenger traffic increased by 9% in total.

“Growth in traffic has been significant although there is still room for better loads in the low season”, says Magni Arge, CEO. Growth has been driven by low-fare campaigns and supported by growth in capacity in Q1.

In June, the second Airbus was introduced to service both the route network to the Faroes and charter operations out of Denmark. Like the first aircraft it was also modified to support the groundbreaking RNP AR navigational aid system. The system has improved the regularity and saved us a number of diversions. However, in July, the severe fog interrupted operations consistently over a period of four weeks resulting in 54 diversions and cancellations as well as a further 70 delays.

Without RNP AR equipped aircraft we would have experienced a further 20 diversions. The total cost of the unrecedented weather interruption in July is estimated at between 7.5 and 8.5 MDKK .” says Magni Arge.

Atlantic Airways currently estimates that the full-year result in 2013 will be about the same level as in 2012, yet fuel prices, adverse weather, and advice against travel to Egypt may have a negative impact on the result. Other risk factors mentioned in the Risk management section in the 2012 annual report may similarly affect the financial performance.